SEC NEWS DIGEST

Commission Announcements

Commission Meetings

Securities and Exchange Commission Investor Advisory Committee will hold a meeting on Friday, September 28, 2012, in Multi-Purpose Room LL-006 at the Commission’s headquarters, 100 F Street, N.E., Washington, DC. The meeting will begin at 10:00 a.m. (EDT) and will be open to the public. Seating will be on a first-come, first-served basis. Doors will open at 9:30 a.m. Visitors will be subject to security checks. The meeting will be webcast on the Commission’s website at www.sec.gov.

On September 7, 2012, the Commission issued notice of the Committee meeting (Release No. 33-9358), indicating that the meeting is open to the public and inviting the public to submit written comments to the Committee. This Sunshine Act notice is being issued because a quorum of the Commission may attend the meeting.

The agenda for the meeting includes introductory remarks from Commissioners; introductory remarks from Committee officers; and reports from the four Investor Advisory Committee subcommittees (the Investor as Owner subcommittee, the Investor as Purchaser subcommittee, the Investor Education subcommittee, and the Market Structure subcommittee).

For further information, please contact the Office of the Secretary at (202) 551-5400.

Rules and Related Matters

SEC Extends Temporary Municipal Advisor Registration Rule

On September 21, 2012, the Commission amended interim final temporary Rule 15Ba2-6T by extending the expiration date of that rule and Form MA-T, which provide a method for municipal advisors to temporarily satisfy the registration requirement under the Securities Exchange Act of 1934. Without the twelve-month extension, the rule and form would expire on September 30, 2012. The extension will allow municipal advisors to continue to temporarily satisfy the statutory registration requirement until the Commission promulgates a final rule that establishes another manner of registration of municipal advisors, prescribes a form for such purpose, and develops an electronic registration system. Publication of the extension is expected in the Federal Register during the week of September 24. (Rel. 34-67901)

ENFORCEMENT PROCEEDINGS

Commission Permanently Disqualifies Accountant Michael C. Pattison from Appearing or Practicing Before the Commission Following the Entry of a Permanent Injunction

The Commission has permanently disqualified Michael C. Pattison, an accountant and former Controller of Embarcadero Technologies, Inc., from appearing or practicing before it as an accountant pursuant to Rule of Practice 102(e)(3). The Commission found that Pattison had been permanently enjoined by the United States District Court for the Northern District of California after a jury found that Pattison violated Section 13(b)(5) of the Securities Exchange Act of 1934 and Exchange Act Rule 13b2-1 in connection with Pattison's involvement in backdating stock options. The District Court had found that Pattison acted knowingly when he falsified records and circumvented internal controls to make it appear that no stock option grants were backdated and below fair market value. The Commission found that it was in the public interest and necessary to preserve the integrity of its processes to permanently disqualify Pattison from practice before the Commission. The Commission also found that the sanction is remedial because it will prevent Pattison and deter others from disregarding their professional responsibilities and protect the investing public by encouraging reliable corporate disclosure and accountability through accurate recordkeeping and diligent compliance with internal accounting controls. (Rel. 34-67900; AAE Rel. 3407; File No. 3-14323)

In the Matter of Stock Markets Institute, Inc. and Sergey Perminov

On September 21, 2012, the Commission issued an Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to Sections 203(e), 203(f) and 203(k) of the Investment Advisers Act of 1940 (Advisers Act), Making Findings and Imposing Remedial Sanctions and a Cease-and-Desist Order (Order) against Stock Markets Institute, Inc. (SMI) and Sergey Perminov (Perminov). The Order finds that SMI, a registered investment adviser and on-line financial newsletter publisher that provides a service commonly referred to as “auto-trading,” misrepresented and omitted to state material facts regarding the returns achieved by certain of its newsletters in 2008 and 2009. Perminov is the founder, president, and 80% owner of SMI and manages the operations of SMI. SMI publishes several paid subscription newsletters, including, during 2008, QQQQ Picks, and during 2009, QQQQ Picks and QQQQ Enhanced Picks. The Order finds that SMI inflated its 2008 performance results for the QQQQ Picks newsletter by failing to disclose a number of trade alerts that resulted in significant losses. The Order also finds that SMI inflated its number of winning trades in 2009 for the QQQQ Picks and QQQQ Enhanced Picks newsletters by reporting trades made by different broker-dealers in connection with a single winning trade alert as separate trades where the broker-dealers obtained different prices when executing that trade alert. SMI also failed to disclose trade alerts that resulted in losses.

Based on the above, the Order censures SMI and Perminov and requires them to cease and desist from committing or causing any violations and any future violations of Sections 206(2) and 206(4) of the Advisers Act and Rules 206(4)-1(a)(2) and (5) thereunder. The Order also requires Perminov to pay a civil penalty in the amount of $40,000 and requires SMI to pay a civil penalty in the amount of $75,000, for which Perminov is jointly and severally liable. The Order also requires SMI to comply with certain Undertakings, including making available to current and potential subscribers the complete performance histories for all of its newsletters; establishing internal procedures and controls reasonably designed to ensure the accuracy of SMI’s representations regarding the performance of its trading; and retaining an independent compliance consultant to perform annual reviews of SMI’s internal controls, policies and procedures, performance representations, and advertising materials for compliance with the Advisers Act for a period of two years. SMI and Perminov each consented to the issuance of the Order without admitting or denying any of the findings in the Order. In determining to accept their offers of settlement, the Commission considered remedial acts undertaken by SMI. (Rel. IA-3473; File No. 3-15038)

On September 20, 2012, the Securities and Exchange Commission filed fraud charges against a Portland, Oregon-based investment adviser who perpetrated a long-running Ponzi scheme that raised over $37 million from more than 100 investors in the Pacific Northwest and across the country.

The SEC alleges that Yusaf Jawed and two entities he controlled (Grifphon Asset Management LLC and Grifphon Holdings LLC) used false marketing materials that boasted double-digit returns to lure people to invest their money into several hedge funds he managed. He then improperly redirected their money into accounts he personally controlled. As part of the scheme, Jawed created phony assets, sent bogus account statements to investors, and manufactured a sham buyout of the funds to make investors think their hedge fund interests would soon be redeemed. Jawed misused investor money to pay off earlier investors, pay his own expenses and travel, and create the overall illusion of success and achievement to impress investors.

The SEC’s complaint against Jawed additionally charges Robert P. Custis, an attorney who Jawed hired to assist him in the fraud. Custis sent false and misleading statements to investors about the status of a purported buyout of the Grifphon funds’ assets. Custis consistently misrepresented that this purchase was imminent and would result in investors’ investments being repaid at a profit.

The SEC filed separate complaints against two others connected to Jawed’s scheme. Those complaints allege that Jacques Nichols – a Portland-based attorney – falsely claimed to investors that an independent third party would pay tens of millions of dollars to buy the hedge funds’ alleged assets at a premium, and that Jawed’s associate, Lyman Bruhn, of Vancouver, Wash., ran a separate Ponzi scheme and induced investments through false claims he was investing in “blue chip” stocks. Nichols, Bruhn, and two entities Bruhn controlled (Pearl Asset Management LLC and Sasquatch Capital Management, LLC) agreed to settle the SEC’s charges without admitting or denying the allegations by consenting to entry of permanent injunctions against violations of the antifraud provisions of the Securities Exchange Act of 1934 and the Investment Advisers Act of 1940 and other relief.

INVESTMENT COMPANY ACT RELEASES

Pruco Life Insurance Company, et al.

An order has been issued pursuant to Sections 26(c) and 17(b) of the Investment Company Act of l940, as amended (the “1940 Act”) on an application filed by Pruco Life Insurance Company (“Pruco Life”), Pruco Life Flexible Premium Variable Annuity Account (“Pruco Life Variable Annuity Account”), Pruco Life Insurance Company of New Jersey (“Pruco Life of New Jersey”), Pruco Life of New Jersey Flexible Premium Variable Annuity Account (“PLNJ Variable Annuity Account”), Prudential Annuities Life Assurance Corporation (“Prudential Annuities”), Prudential Annuities Life Assurance Corporation Variable Account B (“Variable Account B”), Allstate Life Insurance Company (“Allstate Life”), Allstate Financial Advisors Separate Account I (“Separate Account I”), Allstate Life Insurance Company of New York (“Allstate New York” and collectively with Pruco Life, Pruco Life of New Jersey, Prudential Annuities and Allstate Life, the “Insurance Companies”), Allstate Life of New York Separate Account A (“Separate Account A” and collectively with Pruco Life Variable Annuity Account, PLNJ Variable Annuity Account, Variable Account B and Separate Account I, the “Separate Accounts”), and Advanced Series Trust (“AST”). The order permits the Insurance Companies and the Separate Accounts to substitute the shares of AST Franklin Templeton Founding Funds Allocation Portfolio for shares of the Franklin Templeton VIP Founding Funds Allocation Fund, a series of Franklin Templeton Variable Insurance Products Trust, held by the Separate Accounts to fund certain individual variable annuity contracts issued by the Insurance Companies. The order also exempts Pruco Life, Pruco Life of New Jersey, Prudential Annuities, Pruco Life Variable Annuity Account, PLNJ Variable Annuity Account, Variable Account B and AST from Section 17(a) of the l940 Act to the extent necessary to permit them to engage in certain in-kind transactions in connection with the substitution. (Rel. IC-30209 - September 20)

SELF-REGULATORY ORGANIZATIONS

Immediate Effectiveness of Proposed Rule Change

A proposed rule change filed by Chicago Board Options Exchange, Incorporated to amend the Fees Schedule (SR-CBOE-2012-089) has become effective pursuant to Section 19(b)(3)(A) of the Securities Exchange Act of 1934. Publication is expected in the Federal Register during the week of September 24. (Rel. 34-67893)

Approval of Proposed Rule Change

The Commission granted approval of a proposed rule change (SR-BATS-2012-033), as modified by Amendment No. 1 thereto, submitted by BATS Exchange, Inc. pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 and Rule 19b-4 thereunder to list and trade shares of the iShares Short Maturity Bond Fund. Publication is expected in the Federal Register during the week of September 24. (Rel. 34-67894)

Proposed Rule Changes

NYSE MKT LLC filed a proposed rule change (SR-NYSEMKT-2012-47) pursuant to Section 19(b)(1) of the Securities Exchange Act to amend the NYSE Amex Options LLC Members Agreement to empower the Volume Dispute Committee to establish principles for determining whether the Exchange has experienced a bona fide systems problem and to adjust certain volume measurements accordingly. Publication is expected in the Federal Register during the week of September 24. (Rel. 34-67895)

The Options Clearing Corporation filed a proposed rule change (SR-OCC-2012-17) under Section 19(b)(1) of the Securities Exchange Act of 1934 relating to the margining of segregated futures customer accounts on a gross basis. Publication is expected in the Federal Register during the week of September 24. (Rel. 34-67896)

NYSE MKT LLC filed a proposed rule change and Amendment No. 1 (SR-NYSEMKT-2012-42) under Section 19(b)(1) of the Securities Exchange Act of 1934 Amending Rule 903(h) and related Commentary .10 to expand the number of expirations available under the Short Term Option Series Program (“STOS Program”), to allow for the Exchange to delist any series in the STOS that do not have open interest and to expand the number of series in STOS under limited circumstances. Publication is expected in the Federal Register during the week of September 24. (Rel. 34-67897)

NYSE Arca, Inc. filed a proposed rule change and Amendment No. 1 (SR-NYSEARCA-2012-95) under Section 19(b)(1) of the Securities Exchange Act of 1934 amending Commentary .07 to NYSE Arca Options Rule 6.4 to expand the number of expirations available under the Short Term Option Series Program (“STOS Program”), to allow for the Exchange to delist any series in the STOS that do not have open interest and to expand the number of series in STOS under limited circumstances. Publication is expected in the Federal Register during the week of September 24. (Rel. 34-67898)

SECURITIES ACT REGISTRATIONS

The following registration statements have been filed with the SEC under the Securities Act of 1933. The reported information appears as follows: Form, Name, Address and Phone Number (if available) of the issuer of the security; Title and the number and/or face amount of the securities being offered; Name of the managing underwriter or depositor (if applicable); File number and date filed; Assigned Branch; and a designation if the statement is a New Issue.

Amendments to the Registrant's Code of Ethics, or Waiver of a Provision of the Code of Ethics

5.06

Change in Shell Company Status

6.01

ABS Informational and Computational Material.

6.02

Change of Servicer or Trustee.

6.03

Change in Credit Enhancement or Other External Support.

6.04

Failure to Make a Required Distribution.

6.05

Securities Act Updating Disclosure.

7.01

Regulation FD Disclosure

8.01

Other Events

9.01

Financial Statements and Exhibits

8-K reports may be viewed in person in the Commission's Public Reference Branch at 100 F Street, N.E., Washington, D.C. To obtain paper copies, please refer to information on the Commission's Web site at http://www.sec.gov/answers/publicdocs.htm. In most cases, you can view and download this information by using the search function located at http://www.sec.gov/edgar/searchedgar/companysearch.html.